Baffinland Iron Mines expects to meet or exceed its annual haul allowance this year

The Baffinland Iron Mines Corporation has alerted the Nunavut Impact Review Board it is on track to haul more iron ore from the Mary River mine than it's licensed to haul.

Company says reaching permit limit is a milestone, proves viability of the high Arctic mine

A view of Baffinland Iron Mine's camp at Milne Inlet in Nunavut in August 2014. The mine is on track to meet or exceed its annual ore haulage limit this year. (Baffinland)

The Baffinland Iron Mines Corporation expects to reach or exceed its annual iron ore haul allowance out of the Mary River mine this month.

A letter to the Nunavut Impact Review Board from the company states the Baffin Island mine is on pace to surpass its 4.2-million-tonne annual permit limit. Because that limit may be breached, the company wanted to alert regulators.

Baffinland has already hauled more ore this year than in all of 2016.

In the letter, the company said halting production now to avoid the risk of surpassing its annual limit would create economic hardships for both the mine and mine workers who would be laid off in the weeks just before Christmas.

Todd Burlingame, Baffinland's vice president of sustainable development, confirmed the company does not intend to halt production as it's too soon to confirm the limit will in fact be exceeded. The company tallies its ore haul at the end of the month, so it won't know its final total for 2017 until January.

"We aren't going to be able to have a number between now and the end of the calendar year," Burlingame said. "We do anticipate that we will reach 4.5 [million tonnes] by the end of the year, although equipment reliability and weather all figure in."

It's not clear what penalties, if any, Baffinland would face for exceeding its haul limit.

But Burlingame said reaching production of 4.2 million tonnes, or more, in the mine's third year of operation would be a "significant milestone" for the company.

"What we want to be able to do is prove to investors that you can ship ore out of the high Arctic," Burlingame said.

"It means a lot to future investments," he said. "If we could expand to get to a sustainable level this could be an operation that'll provide an economic base for the North Baffin region for a very, very long time."

In the letter to the review board, the mine states it remains well below it's cumulative allowance since production began in 2015.

No one from the Nunavut Impact Review Board was immediately available for comment.

With files from Nick Murray